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Exhibit B
Exhibit 99.B
MAGNA-LAB INC.
July 27, 2000
Xxxxxx Xxxxxxxxxx
Xxxx Investments in Technologies, Ltd.
Netanya, Israel
Xxxxx Xxxxxx
RKP Capital Partner, LLC
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Re: Magna-Lab Inc.
Dear Gentlemen:
Reference is made to that certain letter agreement dated December 17, 1999 (the
"December 17 Letter"), as amended by letters dated March 7, 2000 (the "March 7
Letter") and May 26, 2000 (the "May 26 Letter") (collectively, the "Xxxx Letter
Agreement") between Magna-Lab Inc. (the "Company) and Xxxx Investments in
Technologies, Ltd. (successor in interest to Xxxx Electrotechnica Limited)
("Xxxx"). Reference is also made to that certain letter agreement dated December
6, 1999, as amended by letter dated December 20, 1999, (the "Perres Letter
Agreement") between the Company and Xxxxx Xxxxxx.
Pursuant to the Xxxx Letter Agreement, Xxxx paid a non-refundable deposit of
$250,000 and purchased a total of $500,000 worth of the Company's common stock
at $0.22 per share and agreed to purchase an additional $2,250,000 worth of the
Company's common stock at $0.22 per share by May 27, 2000. Xxxx paid an
additional non-refundable deposit of $100,000 to permit Xxxx to extend its time
to pay the balance of its commitment to July 27, 2000. Xxxx has requested that
in exchange for additional investment undertakings by Xxxx as described herein,
that it be granted additional time to pay the balance of its existing
commitment.
The Xxxx Letter Agreement is hereby amended as follows:
1. Paragraph 4 of the December 17 Letter is deleted in its entirety and
replaced with the following:
"By July 28, 2000, Xxxx will purchase an additional $750,000 worth of
common stock of Magna-Lab at $0.22 per share. By September 15, 2000, Xxxx
will purchase an additional $700,000 worth of common stock of Magna-Lab at
$0.22 per share. By October 15, 2000, Xxxx will purchase an additional
$700,000 worth of common stock of Magna-Lab at $0.22 per share. Xxxx has the
right to make partial payments prior to payment dates set forth above for a
pro rata number of shares. Notwithstanding anything in this paragraph 4 to
the
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contrary, in the event that for any 5 consecutive trading days or any 10
trading days in a 30 trading day period, the bid price of Magna-Lab's common
stock closes at $2.00 or more per share at any time after the date of this
and prior to October 15, 2000, Magna-Lab shall thereafter have the right to
demand, by delivery of written notice to Xxxx, that Xxxx pay such $2,150,000
amount immediately. Within 15 days of delivery of such notice, Xxxx shall
pay to Magna-Lab such amount".
The foregoing payment terms will be reflected in a promissory note delivered by
Xxxx to the Company promptly following execution of this letter agreement.
2. All non-refundable deposits paid by Xxxx to the Company will be applied
toward the balance of Xxxx'x commitment only if such balance is timely
paid.
3. Paragraph 5 of the Xxxx Letter Agreement is deleted in its entirety and
replaced with the following:
"Xxxx hereby irrevocably commits to purchase 13,636,363 shares of Class A
Common Stock of Magna-Lab for $3,000,000, or $0.22 per share, payable as
follows: $1,000,000 by September 30, 2000 and the balance by October 31,
2000. The payment terms will be reflected in a promissory note delivered by
Xxxx to Magna-Lab promptly following execution of the letter agreement dated
July 27, 2000. Magna-Lab shall issue and deliver the shares in installments
as and when payment is received.
Effective upon final payment of the full $2,150,000 referred to in paragraph 1
above, Xxxx agrees to exercise options to purchase 3,500,000 shares of the
Company's Class A Common Stock at $0.02 per share which represents all of the
options to which Xxxx is entitled pursuant to the Xxxx Letter Agreement. Xxxx
shall deliver the $70,000 exercise price at the same time as the exercise of
such options, together with such other documentation as the Company or its
counsel deem necessary or appropriate in connection with such option exercise.
Additionally, Perres elects to exercise options to purchase 3,500,000 shares of
the Company's Class A Common Stock at $0.02 per share which represents all of
the options to which Perres is entitled pursuant to the Perres Letter Agreement.
Perres shall deliver $70,000 to the Company within 10 days of the date hereof
as full payment for the exercise of such options, together with such other
documentation as the Company or its counsel deem necessary or appropriate in
connection with such option exercise.
The Company will use its best efforts to obtain approval from its stockholders
to increase its authorized shares in an amount sufficient to cover the share
issuances contemplated by this letter agreement, as well as such additional
number shares as the Board determines to be appropriate.
By the letter, Perres agrees to make an additional investment in the Company.
Perres agrees to purchase 9,090,909 shares of Class A Common Stock of the
Company for $2,000,000 or $0.22 per share. Perres shall pay such amount to the
Company by
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September 30, 2000. The payment terms will be reflected in a promissory note
delivered by Perres to the Company promptly following execution of this letter
agreement. The Company shall issue and deliver the shares after it has timely
received payment therefor. It is understood that although Perres is hereby
irrevocably committing to purchase such shares, it is contemplated that the
Company will first offer investors in the recent private placement as well as
members of management an opportunity to purchase such shares on the same basis.
Subject to timely receipt by the Company of the above-referenced $3,000,000 from
Xxxx and $2,000,000 from Perres, Magna agrees to seek a listing of its common
stock on either Nasdaq or Amex at such time as it reasonably believes it will be
able to meet the applicable minimum listing requirements.
This letter agreement shall be governed by and construed in accordance with the
laws of the State of New York (without giving effect to its rules as to
conflicts of law). This letter agreement may be executed in counterparts, each
of which will be deemed an original, but all of which taken together will
constitute one and the same instrument.
If this letter accurately reflects your understanding of the matters discussed
herein, please execute the copy of this letter in the space provided below and
return the executed copy to us to indicate your agreement.
Very truly yours,
MAGNA-LAB, INC.
By: /s/ Xxxxxxxx X Xxxxxxx
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Name: Xxxxxxxx X Xxxxxxx
Title: President
Agreed to and accepted this __ day of July, 2000
XXXX INVESTMENTS IN TECHNOLOGIES LTD.
(with respect to the paragraphs applicable to it)
By:
---------------------------------------
Name:
Title:
Agreed to and accepted this __ day of July, 2000
(with respect to the paragraphs applicable to him)
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Xxxxx Xxxxxx
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